During the month of June, Rowling Boutique had cash sales of $233,200 and credit

Question

During the month of June, Rowling Boutique had cash sales of $233,200 and credit sales of $153,700, both of which include the 6% sales tax that must be remitted to the state by July 15.

Prepare the adjusting entry that should be recorded to fairly present the June 30 financial statements. (If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. Credit account titles are automatically indented when amount is entered. Do not indent manually.)

Date

Account Titles and Explanation

Debit

Credit

Date

Account Titles and Explanation

Debit

Credit

June 30

Explanation / Answer

Cash Sales
$233,200 / 1.06 = $220,000 Cash Sales. That leaves $13,200 Sales Tax.
Credit Sales
$153,700 / 1.06 = 145,000 Credit Sales. That leaves $8,700 Sales Tax.

Date Account Titles and Explanation Debit Credit June 30 Sales $13,200 Credit Sales $8,700   Sales Tax Payable $21,900

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